News Corp. and Rupert Murdoch are doubling down on a business segment that for years has been a key to the company's success: sports. Pictured: Big Ten bound Rutgers and Maryland.
DEAL OF THE WEEK: News Corp. Takes A Bold Shot At Sports Rights: News Corp. and Rupert Murdoch are doubling down on a business segment that for years has been a key to the company’s success: sports.
It has been a busy few weeks for News Corp., which on Nov. 20 acquired a 49 percent stake in New York Yankees regional broadcaster YES Network for $1.5 billion, aligning Murdoch with one of the most popular (and lucrative) sports brands. That same day, Fox scored when the University of Maryland and Rutgers University declared they would join the Big Ten Conference — bolstering the Big Ten Network, of which Fox owns 51 percent. And in early November, News Corp. assumed control of ESPN Star Sports, Disney’s Asian sports service, for $250 million.
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Meanwhile, Fox Sports is negotiating a new TV contract with the Los Angeles Dodgers. That deal, which a source close to the negotiations tells THR could be worth $6 billion to $7 billion over 25 years, would be the richest sports TV rights pact ever.
Of course, Fox long has been willing to bet on sports. In 1993, the company aggressively outbid CBS for rights to broadcast NFL games. Fox bid $1.58 billion for four years of NFC games — more than $100 million more a year than CBS — and the move helped legitimize Fox’s broadcast network and paid dividends as the NFL became the dominant sport on U.S. television.
The Dodgers deal could again raise eyebrows. The team was purchased in the spring by Guggenheim Baseball Management, a group led by Guggenheim Partners (also an owner of THR), for a record $2.15 billion partly attributed to the likely windfall of a new TV deal.
In driving a hard bargain, the Dodgers could point to another high-profile L.A. sports rights transaction: Time Warner Cable’s 2011 deal for rights to Lakers games for 25 years at a cost of as much as $5?billion. TWC’s coup was a loss for Fox, which previously aired Lakers games on Fox Sports West. If Fox were to secure the Dodgers’ rights, it would control TV access to two of baseball’s storied franchises — the Yankees and Dodgers — and could create new channels using their 162 regular-season games as an anchor.
With the Big Ten Network, which launched in 2007, Fox has had steady success: It is in about 50?million homes, according to SNL Kagan, with distributors paying an average of 37 cents a subscriber per month. Analysts say the addition of Maryland and Rutgers could mean 15 million more homes and a bump in sub rates to $1.25 in 2017, when carriage deals will be renegotiated. “This could generate more than $175 million,” says Patrick Rishe, a Webster University sports economics professor.
Of course, a Dodgers network would generate far greater sub fees than a college conference network — or so Fox hopes. At some point, TV providers likely will draw a line in the sand over ballooning sports rights fees.
Fox Sports declined comment beyond that it is “working hard to reach an agreement that achieves the goals of Dodgers ownership and also makes sense for our business.” — Daniel Miller and Eriq Gardner
Mogul Mansion Off the Market
Takashige Ichise, producer of Ringu, which was remade as The Ring, is selling an L.A. residence once owned by mogul Samuel Goldwyn. The seven-bedroom house on Camino Palmero Street below Runyon Canyon was listed at $4.619 million and went into escrow with an undisclosed buyer Oct. 11. The walled 6,488-square-foot Neoclassic residence includes Hollywood touches like a script-reading room, says Rodeo Realty agent Josh Buxbaum, who is representing the buyer and seller. The property also includes a guesthouse and a pool and sits on about three-quarters of an acre. The deal is expected to close by year’s end. — Daniel Miller
New Star Wars Writers Set to Expand Disney’s Galaxy
The post-George Lucas Star Wars universe slowly is taking shape. Soon after it was announced Oct. 30 that Disney would acquire Lucasfilm for $4.05 billion, it was revealed that Oscar winner Michael Arndt (Little Miss Sunshine) had written a 40- to 50-page treatment for the new trilogy and would be writing the script for Star Wars: Episode VII. Then reports emerged the week of Nov. 19 that The Empire Strikes Back‘s Lawrence Kasdan (CAA, Greenberg Glusker) and Sherlock Holmes‘ Simon Kinberg (CAA, Jackoway Tyerman) would be writing and producing Episode VIII and Episode IX, even as Disney and Lucasfilm refused to confirm their top-secret plans. But now insiders tell THR that while Kasdan and Kinberg have indeed been hired to work on the Star Wars franchise, they will be writing separate projects (hence the reason why they also would receive producer credits), not necessarily Episode VIII and Episode IX. Their scripts could turn into official “Episodes” in the main Skywalker storyline, or they could form the basis for spinoffs focusing on side characters. Disney CEO Robert Iger said the goal is to release a Star Wars movie “every two to three years,” and some could easily focus on other pieces of the expansive mythos (similar to Marvel’s Avengers universe). Disney and Lucasfilm declined comment. — Borys Kit
FILM
Patrick Wilson (CAA, Anonymous, Hansen Jacobson) and Rose Byrne (CAA, RGM Artist Group) will reprise their roles for Insidious Chapter 2, a sequel to the hit 2010 horror movie. James Wan returns to direct.
Eddie Cibrian (ICM, Media Four), Amy Smart (Gersh, Untitled, Sloane Offer), Terry Crews (WME, 3 Arts, Morris Yorn) and Nia Long (Global Artists, Stone Meyer) have joined Tyler Perry’s Single Moms Club. Perry wrote the script and is directing the comedy.
Griffin Dunne (UTA, Industry), Denis O’Hare (Innovative) and Bradford Cox of alt rock group Deerhunter have joined the Matthew McConaughey AIDS drama Dallas Buyers Club.
Warner Bros. has extended its relationship with Village Roadshow Pictures (Sherlock Holmes, Gangster Squad) through 2017 and has secured $1.125 billion in debt equity to fund multiple projects.
Cinemark, the third-largest U.S. movie theater owner, will acquire 32 theaters from Rave Cinemas for about $240 million.
Bruce McGill (Stone Manners) has joined Ride Along, Universal’s action comedy staring Ice Cube and Kevin Hart.
Minnie Driver (CAA, Untitled, Morris Yorn), Paul Adelstein (Abrams, Principal, Gang Tyre) and Alfred Molina (WME, Hyler) will star in Return to Zero, an indie drama written and to be directed by Sean Hanish.
TELEVISION
Beyonce (ICM, Hansen Jacobson, Reed Smith) is the subject of an HBO documentary that she’s also directing. The film is set to premiere Feb. 16.
Saturday Night Live‘s Kenan Thompson (UTA, Michael Goldman, Del Shaw) has sold a family comedy to NBC, with the comedian attached to write, star in and executive produce with SNL‘s Lorne Michaels.
ESPN will broadcast college football playoff games for 12 years, beginning in 2014, in a deal The Wall Street Journal said is worth $5.64 billion.
Entourage producers Mark Wahlberg (WME, Leverage, Sloane Offer), Steve Levinson (WME, Sloane Offer) and Rob Weiss (UTA, Hansen Jacobson) are developing The Happy Tree, a marijuana-themed comedy, for Fox.
Boy Meets World co-stars Ben Savage (Abrams Artists) and Danielle Fishel (Levity) will reprise their roles as Cory Matthews and Topanga Lawrence in Disney Channel’s Boy Meets World follow-up, Girl Meets World.
White Collar alum Natalie Morales (UTA) has joined ABC comedy pilot Trophy Wife, starring Bradley Whitford and Malin Akerman.
CSI producer Carol Mendelsohn (WME, Jackoway Tyerman) is adapting Kate Braestrup’s spiritual novel Here if You Need Me at CBS, with Neil Tolkin (The Emperor’s Club) on board to write the script.
Brian Dennehy (Susan Smith, Katz Golden) will guest star as Laura Linney’s father in an episode of Showtime’s The Big C.
The U.K.’s ITV network has renewed Downton Abbey for an eight-episode fourth season to air next fall, plus a Christmas special. … Smithsonian Channel has greenlighted L.A. Frock Stars, its first unscripted series, about vintage clothing guru Doris Raymond. … Turner Classic Movies will air next summer Carson on TCM, specials featuring Johnny Carson celebrity Tonight Show interviews.
BRANDING
Gwyneth Paltrow is collaborating with Beyond Yoga to create two pieces of clothing to be sold exclusively on her Goop.com website.
DIGITAL
Netflix has inked a deal with Warner Bros. International Television Distribution to bulk up its online video offerings in Canada.
Investor Carl Icahn spent $323.6 million to buy 5.5 million shares of Netflix stock in October and November, according to an SEC filing.
LABOR
The American Federation of Musicians has inked a three-year deal with ABC, NBC and CBS to cover bands on shows including Dancing With the Stars and The Tonight Show With Jay Leno.
MUSIC
Bob Dylan and Paul Simon are among the acts that have signed with Kobalt Music Group to manage their “neighbouring rights” to track royalties worldwide.
AC/DC, one of the few digital holdouts, has inked a pact with Apple to sell its 23-album catalog via iTunes.
REAL ESTATE
The Office‘s Jenna Fischer and her husband, screenwriter Lee Kirk, have purchased a Mediterranean estate in Glendale for $1.9?million. The five-bedroom, 4,565-square-foot house once belonged to famed New York Yankees manager Casey Stengel.
Madonna has listed her Upper West Side New York duplex in the Harperley Hall building for $23.5 million.The 6,000-square-foot, two-story unit has six bedrooms and eight bathrooms.
Producer Stacey Sher and musician Kerry Brown have sold a Beverly Hills-area house once owned by actress Julie Andrews for $5.15 million. The five-bedroom, 7,800-square-foot residence was purchased by an undisclosed buyer.
REP SHEET
Rapper Romeo Miller, who has appeared in Madea’s Witness Protection and Jumping the Broom, has signed with ICM Partners.
Tom Clancy, who wrote The Hunt for Red October and its sequels, has signed with WME.
Chazz Palminteri, whose credits include Bullets Over Broadway, has signed with management firm Liebman Entertainment.
Jake Abel, who has appeared in I Am Number Four and The Lovely Bones, has signed with CAA.
Armando Bo, whose directorial debut The Last Elvis bowed at Sundance this year, has signed with UTA.
THE NEXT BIG THING: Chad Coleman
Reps: Talent Works, Vanguard. Why He Matters: The veteran character actor and alum of HBO’s The Wire has landed a key role on AMC’s megahit The Walking Dead. He’ll play the mysterious Tyreese, a fan favorite from the comic book series that forms the basis for the zombie drama.
